Public Sector is the key to reducing income inequality says Canadian Centre for Policy Alternatives


A new report by the Canadian Centre for Policy Alternatives (CCPA) found that the public sector is the key to reducing income inequality in the workplace. First and foremost, discrimination is alive and thriving in Canada. Wage discrimination exists between men and women and between immigrants and Canadian-born workers.

In the private sector however, women make 10% less than men and in the public sector, the gender pay gap is only 5%. In fact, women in the public sector make 4% more than women in the private sector. Similarly, the private sector pays landed immigrants 8% less than Canadian-born workers, even after adjusting for factors like education. In the public sector, landed immigrants make 5% less than their Canadian-born counterparts.

The public sector raises pay for those who experience discrimination: women, mothers and new Canadians. The public sector does this by raising the wage floor while also capping the highest wages. Whereas in the private sector, executives are overpaid and receive bonuses on top of their inflated and unchecked salaries – widening the wage gap and making the rich even richer.

This is not to say that there is no discrimination in the public sector. We still have a lot of work to do to eliminate wage gaps and the motherhood penalty in the public sector. But the CCPA report found that if the private sector were to pay more like the public sector, we could reduce income inequality overall in the workplace.

What does that mean? It means that when we fight for better public sector wages, we’re fighting to eliminate discriminatory wage gaps. We’re fighting for better labour practices for ALL workers. It also means that if we were to bring privatized public services back into the public, we could further reduce income inequality.

It may seem that our fight for better wages is just about that: better wages. But the fight for better wages in the public sector is a fight for income equality no matter who you are or where you come from.

You can read the CCPA’s full report here.